UPS boosts last-mile deliveries instead of paying USPS as earnings rise

United Parcel Service Inc. reported 10% growth in quarterly income, helped by efforts to boost efficiency and lessen its costs delivering online orders to U.S. homes.

Residential deliveries, up more than 6% in the quarter, are inherently more costly than shipments to businesses because the packages tend to require more driving and time. UPS has invested in software to improve delivery routes, added package pickup locations to pool deliveries, and is doing more so-called last-mile deliveries instead of paying the U.S. Postal Service for that service.

UPS boosts last-mile deliveries instead of paying USPS as earnings rise

The company said it expects its momentum to continue, and it backed its full-year guidance. But it also said a decision by the U.S. Treasury Department regarding pension cuts may trigger a charge of up to $3.8 billion this year that would push earnings to the lower end of its forecast range.

For the quarter ended March 31, revenue rose 3.2% to $14.42 billion. UPS earned $1.13 billion for the period, up from $1.03 billion.

3 thoughts on “UPS boosts last-mile deliveries instead of paying USPS as earnings rise

  1. The first quarter of the year is always the slowest. So instead of letting the USPS deliver the overage of parcels. UPS has plenty of down time to cover it. They have to pay their carriers for eight hours anyway. So they are saving money. However, when the vacation season is over and things pick up, they can’t handle it and will start back up with the postal service. As for UPS being number 1 . Hardly. The USPS had more on time delivery, Is cheaper and beat UPS during the Christmas holiday 5 years running.

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